Federal Treasury Enterprise Sojuzplodoimport v. Spirits International B.V., 809 F.3d 737

Background

The Stolichnaya trademarks (the Marks) were originally registered in the U.S. by a Soviet state enterprise (WO‑SPI); after Soviet-era privatizations SPI claimed ownership and licensed U.S. distributors.
A Russian court later held WO‑SPI’s privatization invalid and the Russian Federation retained rights; Russia then created Federal Treasury Enterprise Sojuzplodoimport (FTE) as a purported successor and FTE licensed Cristall to distribute in the U.S.
FTE sued SPI in U.S. courts asserting Lanham Act § 32(1) claims (registered‑owner claims) and other trademark/unfair‑competition claims; earlier litigation resulted in dismissal of § 32(1) claims for lack of statutory standing (FTE was not an effective assignee) and dismissal/abandonment of other claims.
After the appeal, the Russian Federation issued a Decree and executed an Assignment transferring its rights in the Marks to FTE; FTE then refiled § 32(1) and non‑§ 32(1) claims in the Southern District of New York.
The district court held (1) the Assignment was invalid under Russian law so FTE lacked § 32(1) standing, and (2) FTE’s non‑§ 32(1) claims were barred by res judicata and laches. The Second Circuit vacated the standing dismissal and affirmed dismissal of the non‑§ 32(1) claims.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether FTE has statutory standing under Lanham Act § 32(1) as an assignee of the Russian Federation	FTE: Russian Decree and Assignment validly transferred the Federation’s rights to FTE, making FTE a registrant/assign with standing	SPI: Assignment is invalid under Russian law; FTE therefore lacks statutory standing	Court: Federal courts may not adjudicate validity of a foreign sovereign’s internal transfer (act‑of‑state and comity); vacated district court’s standing dismissal and remanded
Whether U.S. courts may decide validity of a foreign sovereign’s internal decree/assignment	FTE: U.S. courts can examine foreign law to determine standing	SPI: Foreign decree/assignment is subject to review by U.S. courts on standing grounds	Court: Comity and act‑of‑state bar U.S. courts from invalidating internal acts of foreign sovereigns transferring rights among their entities
Whether FTE’s non‑§ 32(1) claims are barred by res judicata	FTE: Prior dismissals were not on the merits for res judicata purposes	SPI: Prior litigation adjudicated claims or could have raised them; preclusion applies	Court: Res judicata bars the non‑§ 32(1) claims because they were or could have been raised previously; affirmed
Whether FTE’s non‑§ 32(1) claims are barred by laches	FTE: Claims tolled or timely; laches should not bar	SPI: Long delay (claims accrued ~2001, asserted in 2014) prejudices defendants	Court: Presumption of laches arose for non‑§ 32(1) claims (statute of limitations ran); district court did not abuse discretion in finding laches and prejudice; affirmed

Key Cases Cited

Pravin Banker Assoc., Ltd. v. Banco Popular Del Peru, 109 F.3d 850 (2d Cir. 1997) (principles of international comity ordinarily preclude review of foreign government acts)
Hilton v. Guyot, 159 U.S. 113 (U.S. 1895) (comity principles governing recognition of foreign judgments and acts)
Banco de Espana v. Federal Reserve Bank of New York, 114 F.2d 438 (2d Cir. 1940) (acts of a foreign sovereign within its territory are deemed valid)
First Nat. City Bank v. Banco Nacional de Cuba, 406 U.S. 759 (U.S. 1972) (act of state doctrine precludes review of sovereign acts done within its territory)
Banco Nacional de Cuba v. Sabbatino, 376 U.S. 398 (U.S. 1964) (discussion of separation of powers and foreign‑act nonreviewability)
W.S. Kirkpatrick & Co. v. Environmental Tectonics Corp., Intl, 493 U.S. 400 (U.S. 1990) (act of state doctrine as a binding principle of decision)
Films by Jove, Inc. v. Berov, 341 F. Supp. 2d 199 (E.D.N.Y. 2004) (distinguishing situs of property for act‑of‑state analysis)
Conopco, Inc. v. Campbell Soup Co., 95 F.3d 187 (2d Cir. 1996) (laches analysis in Lanham Act cases; relation to analogous state statute of limitations)
Tri‑Star Pictures, Inc. v. Leisure Time Productions, 17 F.3d 38 (2d Cir. 1994) (laches is equitable; trial court’s discretion governs application)
Pike v. Freeman, 266 F.3d 78 (2d Cir. 2001) (elements for res judicata)
Criales v. American Airlines, Inc., 105 F.3d 93 (2d Cir. 1997) (dismissal for lack of statutory standing not on merits; curable defect)